New Delhi: The Indian commerce ministry has launched a comprehensive analysis of the potential impact of the newly announced 26 percent reciprocal tariffs imposed by the United States on Indian goods, according to a senior government official who spoke on Thursday.
The official confirmed that the implementation of these tariffs will occur in two phases – an initial universal 10 percent duty on all imports entering the US starting April 5, followed by the remaining 16 percent tariff taking effect from April 10.
"The ministry is conducting a thorough analysis of the announced tariffs and their sectoral implications," the official stated, highlighting a potential silver lining in the situation. "There exists a provision within the framework that if a country substantively addresses the concerns raised by the US, the Trump administration may consider reducing or modifying the duties imposed against that nation."
This development comes at a critical juncture as India and the US are already engaged in negotiations for a comprehensive bilateral trade agreement. Both countries have expressed commitment to finalizing the first phase of this pivotal trade pact by fall (September-October) of this year, which could potentially mitigate some of the tariff impacts.
"It is a mixed bag and not a setback for India," the official emphasized, suggesting that certain export sectors might face challenges while others may remain relatively unaffected.
President Donald Trump specifically highlighted India's existing tariff structure during his announcement of reciprocal tariffs against multiple trading partners. Speaking from the White House Rose Garden on Wednesday, he dramatically revealed a chart displaying various countries' tariff rates alongside the new reciprocal duties they would face.
According to the chart presented by Trump, India currently imposes what the US administration calculates as 52 percent in combined tariffs, currency manipulation effects, and trade barriers on American products. In response, the US will now charge what Trump called a "discounted reciprocal tariff" of 26 percent on Indian goods.
"India, very, very tough. Very, very tough. The prime minister just left. He's a great friend of mine, but I said, you're a friend of mine, but you're not treating us right. They charge us 52 percent...," Trump remarked during his announcement.
The President framed the broad tariff implementation as a watershed moment for American industry. "This is Liberation Day, a long-awaited moment. 2nd April 2025 will forever be remembered as the day American industry was reborn, the day America's destiny was reclaimed, and the day that we began to make America wealthy again. We are going to make it wealthy, good, and wealthy," he declared.
Trade experts note that these tariffs could significantly impact India's export-oriented sectors, particularly IT services, pharmaceuticals, textiles, and automotive components, which form the backbone of India's export portfolio to the United States.
The Indian commerce ministry is reportedly preparing a sector-by-sector assessment to identify vulnerable industries and develop strategic responses. Sources indicate that Indian negotiators are likely to accelerate bilateral trade discussions in hopes of securing exemptions or reductions before the full tariff regime takes effect.
Business associations across India have urged the government to engage proactively with Washington while simultaneously exploring alternative markets to reduce dependency on US trade. Several industry bodies have scheduled emergency meetings to assess the potential disruption to supply chains and export earnings.
Despite the challenges, some analysts suggest this development could ultimately strengthen India's position in diversifying its export markets and accelerating domestic manufacturing capabilities under the "Make in India" initiative, potentially turning a short-term challenge into a long-term strategic advantage.
